An Ontario Affordable Housing Strategy for everyone

When we think about housing policy, we often think about people who have “fallen through the cracks.”

But what happens when the cracks become wider than the pavement? When the majority of people cannot afford their own home? When most people have precarious incomes? When Toronto has more low-income neighbourhoods – 49% of the City![1] — than middle-income neighbourhoods?

You need solutions for the people who live in social housing, supportive housing or shelters. But you also need to look out for the 94% of Ontarians who don’t. Ontario’s updated Long-Term Affordable Housing Strategy is a step in the right direction.

Inclusionary zoning – at last!

The Ontario Government has pledged to introduce legislation that would permit municipalities to create inclusionary zoning by-laws. As I wrote in a 2013 entry, “The public benefits of inclusionary housing are obvious. Wherever new condos rise up, so does the stock of affordable housing – at no cost to the taxpayer. Instead of an increasingly polarized city where only the rich can live downtown, we create seamlessly mixed-income neighbourhoods. Clerks, cooks, and child care workers can afford to live near their work, and people with modest incomes can live where the services are.”

I hope neither the legislature or municipal councils will be spooked by the Ontario Home Builders’ Association’s claims that “free” housing units created through inclusionary zoning must be paid for by their neighbours. First, affordable units created through inclusionary zoning are hardly “free.” They typically rent or sell for 80% of the average local market. That’s the downside of inclusionary zoning: you still need public subsidies if you want to house people on the waiting list.

And second, the price of a new condo is not based on the developer’s costs or the cost of the unit next door. It is set at whatever the market will bear. (Just as my own house has tripled in value, not because my costs have risen but because the market has.)

In any case, let’s never forget that whenever the City up-zones a property, or invests in transit, sewers or parks, it confers benefits – often worth millions of dollars – to owners. Inclusionary zoning simply asks why the entire value of this public benefit should stay in the hands of developers.

Support for intrinsically affordable housing

Basement apartments, laneway houses, and any form of shared housing offers the greatest potential for new affordable housing. Set the right regulatory framework, and then let the crowd make it happen. Good to see the Province is on the case.

An RGI breakthrough

The strategy offers a great conceptual framework for RGI reform. (Read to the end of this blog for my concerns!)

YES to a portable housing benefit framework that will give increased choice for tenants, and make the TCHC Task Force’s vision of mixed-income communities possible.

YES to portable allowances for survivors of domestic violence. May this three-year pilot lead to the end of the Special Priority Access system – one of the most cynical ploys of the Harris Government.

YES to simplified RGI calculations – a blessing for both tenants and social housing landlords.

The foundations for more change

Transformation takes time, money and research. So good to see plans for increased refinancing flexibility, better co-ordination for access systems, and up to $2.5M for an Innovation, Evidence and Capacity-Building Fund.

Not failing the 6%

I celebrate the good news in this strategy. But the strategy’s numbers and examples should give all housing advocates reason for vigilance. After reading through the strategy, I wondered:

Is there enough funding to really help homeless people? It was great to see “up to” $100 million earmarked for housing allowances and support services over 3 years. (As for the promised support for constructing “up to 1,500 new supportive housing units over the long-term” it really depends on just how long the long-term really is.)

It’s a modest help – as is next year’s promised 5.1% increase in the $294M Community Homelessness Prevention Initiative (CHPI) — but it’s not a breakthrough. $100 million spread across 4,000 families works out to $694/month over three years to cover rents and supports. Compare this allocation to Toronto’s At Home/Chez Soi project , cited as a cost-saving success on page 28 of the strategy. That initiative spent $1,227/month on housing allowances and supports for clients with moderate support needs, and $1,757/month for those with high needs.

Will “portability” become a pretext for cuts? Take the example of Mario on page 20. He’s the full-time minimum-wage earner who receives a $350 Portable Housing Benefit to house himself, his wife and child in a two-bedroom apartment. In Toronto, the average rent for a two-bedroom apartment is $1,286 [2]. Subtract $350 and Mario would still pay 48% of his income on rent.[3]

By way of comparison, the Ontario Works Housing Allowance for a family of three living in private housing is $662/month; on ODSP it is $816. TCHC receives an average $363 subsidy for each of its 52,500 rent-geared-to-income units, but tenants in all units pay an average $415/month. (No wonder TCHC is underfunded!)

There are certainly arguments for expanding the number of shallow subsidies to people waiting for housing. They are needed! But as old funding program rules disappear and municipalities exercise their new-found flexibility, we should remember the aim of portability is to increase tenant choices, not limit them.

Will “simplified RGI” actually be simple? As an example of simplifying RGI on page 35, Ontario pledges to exempt certain scholarships and bursaries from RGI calculations. I’m all for helping young people stay housed. But it is exactly this sort of “bits and pieces” approach to income verification that leads to the 100-page RGI manuals we have today.

A stable home is THE goal

One final positive note: it is refreshing to see a government strategy that views a stable home as a goal in itself. For too long housing has been seen chiefly as a vehicle for job creation, or a place where service are delivered, or a cost-saver. It is all that.

But how good to see a strategy that recognizes what we all know: that a good home is the foundation of a good life; and a bad home – or no home – stinks. Reason enough for a strong public response.

[1] Mihael Dinca-Panaitescu and Alan Walks, Income Inequality, Income Polarization, and Poverty, December 2015.

Related

Joy, I quite agree with you that it’s wonderful that LTAHS has given us a new tool called inclusionary zoning (IZ) and the Province will make available to municipalities. But let’s not lose site of the fact that it will take years to see that happen. Not only will the Province need to go through its process to pass legislation but once passed, municipalities will likely have to decide how they want to implement it and will need to pass enabling by-laws. To do that they will need to hold public consultations themselves and the local development lobby fighting it will be huge. By the time all is said and done on this front, I suspect that the cost of housing will continue to rise even higher and become less affordable.

Right now we are hailing the victory of having inclusionary zoning as a solution to the affordable housing supply. It could be “a” solution but should not be misconstrued to be “the” solution. After all, even if affordable housing were built under an IZ approach, it still remains that the definition of affordable is improperly defined as being 80% of average market rent – a rent that even some middle income people will begin to struggle with in larger urban centres like Toronto.

At the LTAHS announcement, Minister McMeekin continually emphasized the need for the private sector to come to the table to build more affordable rental. Point taken. But when I put that emphasis together with the IZ announcement, I’m left wondering why embracing non-profits and co-ops as being a logical approach to building permanently affordable housing (as it did in the early 90’s) isn’t being seen as a supply-side solution. In fact, when you read the LTAHS update, despite the statement that “there is a clear shortage of affordable private and non-profit sector rental housing in Ontario and more opportunities for affordable home ownership are needed” and the desire for a “vibrant non-profit and co-op sector”, the only solutions proposed to increase supply are aimed at the private sector in the form of IZ and second suites.

The province will open the door to Inclusionary Zoning (IZ), but Sharad is right – it will be up to individual municipalities to walk through that door. There will be lots of local opposition from for-profit developers, and I suspect only a handful of municipalities with high property values will even consider it. But it’s the right first step, and I welcome it.

I also welcome the move to housing allowances as another option, especially for victims of violence. I’ve always thought that it is irresponsible to acknowledge that someone’s safety is at risk and that they need to move, and then limit them to 15% of the rental market.

Housing allowances will be a good solution for many other households too. Here in Ottawa, the City has used them successfully to help large families that would otherwise wait forever on the waiting lists for large homes that just don’t exist in the social housing system.

I worry that housing allowances and more local flexibility on service level targets could be combined to reduce local commitments for affordable housing. Will we start housing the same number of people at a cheaper cost, or will we use the flexibility to greatly expand the number of people who get subsidies? I’d like to see the province increase service level targets in exchange for offering that flexibility.

Nice to read your substantial comments, Sharad and Ray. I may be feeling optimistic about IZ because the Minister said he was aiming for legislation by June, because of the words of support from Toronto’s Mayor Tory, and especially because, thanks to Councillor Layton’s initiative, Toronto’s City Council decided to get ahead of the curve — planning IZ policies to be ready whenever the Province decided to step up.

As for your comment about new non-profit housing, Sharad, my own sense is that it depends on the market. In an inflated market like Toronto, a non-profit group can spend $150K per unit and still not get truly affordable housing. Combining IZ with housing allowances or non-profit purchases of units may be a way forward — just as combining publicly owned land with non-profit development, or redevelopments of social housing sites with a mix of private and public development can achieve greater affordability than would be possible with non-profit development alone.

And yes, Ray, I think that service levels will the thing to watch. Flexibility should be the gateway to doing more, not less.

Interesting. I actually knew nothing at all about the “Welsh strategy” until I followed your link. So thank you! I like the idea of focusing on preserving tenancies rather than putting the bulk of the effort into reacting after the fact. The big challenge in Toronto doesn’t seem to be the lack of Housing Help services — it’s that there are simply so few affordable places to move to.